ESMA Sets Deadline For Compliance With EU Stablecoin Regulations

According to BlockBeats, the European Securities and Markets Authority (ESMA) has mandated that cryptocurrency companies comply with the European Union's new stablecoin regulations by March 31. These regulations are part of the broader Markets in Crypto-Assets (MiCA) framework, which requires companies to limit or delist stablecoins that do not meet the standards. The stablecoin provisions of MiCA officially take effect in mid-2024, but ESMA is urging businesses to implement changes by the end of the first quarter. Until then, companies may continue to offer non-compliant stablecoins for sale but are prohibited from purchasing them. ESMA has warned that delays in compliance could disrupt the market. Only stablecoins authorized by regulators in EU member states will be allowed to remain listed. These tokens must maintain adequate reserves and adhere to transparency and governance requirements. The new rules aim to ensure issuers have sufficient liquidity and that investors are informed about their purchases. Tether's USDT is among the stablecoins under intense scrutiny. It remains unclear whether Tether intends to seek EU authorization. The company recently ceased support for its euro-pegged stablecoin, citing regulatory challenges. Observers note that as a 'significant' stablecoin under MiCA, Tether's primary stablecoin may face stricter requirements, including higher capital reserves and more rigorous oversight. As the ESMA deadline approaches, cryptocurrency exchanges and stablecoin issuers in the EU are under pressure to meet the new standards or risk losing access to Europe's vast and growing digital asset market.